In our recent evaluation of coverage calculators, one of the key findings was how different they were across industry sites.
One of the areas that showed most divergence was how simple or complex the calculators were.
It may be the case that many companies did not explicitly choose complexity, but just asked the IT department or an external supplier to develop a calculator and accepted what was produced.
However, it is clear that some organizations have made a conscious decision to define the simplicity (or otherwise) of their tools.
We spoke to some insurers that view calculators as a tool primarily to be used by experienced agents. These tools should be a source of mystery and wonder to consumers and are safe only to be used by highly trained personnel. Help text and consumer-oriented language are luxuries.
At the other end of the scale are very simple calculators that anyone could use.
Fidelity Investments has recently beefed up its life insurance online offering and the calculator it offers has only three items of input data. All people have to do is move a few sliders and hit a button to get an estimate.
Fidelity Investment’s Simple Calculator
This calculator is clearly designed just to get consumers a quick ballpark to start the discussion with a representative.
So which is the best approach, simplicity or complexity? Only by looking to the needs of their own consumers can companies address this question successfully.
What is certain is that the complex, agent-oriented calculator is living on borrowed time. Consumers want to self-serve and self-educate and will not tolerate having to get the help of an agent to complete a basic task.
So the question then is how much complexity to add. A three-field calculator like Fidelity Investment’s is quick to complete but would people doubt its accuracy? Would this make them hesitate to get in touch?
Allstate and USAA, both creating new calculators in 2012, offer medium-length calculators with 7 or 8 fields that ask for financial data.
The key differences between them are that USAA inquire about current cover, while Allstate doesn’t. Also, USAA does not ask about final expenses, and does not ask how many years that the coverage should last or what percentage of current income should be replaced. It appears that the calculator takes these matters into account while doing the math but does not involve the consumer in making decisions on these factors.
Ultimately then companies need to design calculators based on the needs of their own consumers, taking into account their own business models.
The amount of fields and the complexity of the tool will follow the customers’ expectations to ensure that as many people as possible complete the task of estimating coverage.
